The Dilemma of the Small Town Monopoly

In the wake of Walmart coming to town, accelerating the demise of Oriental’s only independent grocer, I remain conflicted about whether the retail giant is to blame or just a scapegoat clouding a complicated reality. For those who were personally and financially vested in this matter (which I am neither) let me express a few facts up front so there is no confusion.

I’m not a fan of Walmart stores or its business model.

While in business, Town & Country (T&C) did not meet my shopping needs, so I didn’t contribute any significant portion of my income to their store.

I don’t personally know any of the T&C owners though I am “friends” with them on Facebook.

It’s always easier to armchair quarterback.

With that said, I hope what follows can be interpreted as constructive criticism at worst and a thoughtful observation at best. My opinions are just that, I have no scientific data or statistical facts. I base the following on my personal observations in Oriental and other towns I have lived in or visited, on top of generally accepted economic principals. The scope of this argument is within the recent events that led up to T&C closing. It does not account for Walmart’s global policies, domination of the retail sector, hiring practices, or business ethics.

Let me reiterate that I don’t like Walmart and I despise Super Walmart. I would spend 20% more to simply avoid the melee of crowds and glut of consumptive advertising. But I am not quick to jump on the, “I hate Walmart because it’s the root of all evil” bandwagon. The leader of any field is always the easy target. The visceral responses I hear are akin to those of political rallying cries against the opposition, which are rarely rooted in reason and most always fueled by emotion. I don’t think the situation for T&C would have been any different if a Piggly Wiggly, Kroger, or Food Lion had set up shop instead, and here is why…

The Small Town Monopoly

T&C had a virtual monopoly on the grocery business in Oriental, much like the Village Health & Fitness has on the gym business. If you don’t like the groceries or the gym, you have little choice but to drive to Grantsboro for food and to New Bern for a gym. I choose to make the 27.4 mile roundtrip to Food Lion for groceries but continue to settle for the Oriental gym (see below).

The advantages of being the only show in town seem significant, but they lead to a fragile position when faced with true competition. Walmart has to stay on the bleeding edge of technology and innovation simply to survive. Until Walmart came to town, T&C needed only to keep their doors open to remain profitable, as evidenced by a 40+ year tenure. And from what I have seen and heard, that tenure didn’t include a wealth of changes or improvements to the store’s operations or infrastructure. This is understandable if a store is profitable and there is no threat of competition. But it was my experience, shared by others, that T&C was failing to provide a consistent supply of fresh fruits and vegetables. Worse, it was failing in the customer service department and unapologetic in the process.

Groceries are the biggest expense category in my personal budget next to housing. I remember well the indifference from the cashiers… and I can’t say I ever recall seeing one of the owners on the floor (that’s not to say that they weren’t… I wasn’t a regular for the aforementioned reasons). Juxtapose this experience with the one 13.7 miles down the road at Food Lion, where I have been personally checked out and greeted by the store manager twice, where I often share a laugh with the cashiers, where the produce workers at least appear to be engaged with their work, and the butcher has shared tips on prepping meat.

These were my experiences prior to the Super Walmart moving in across the street from Food Lion. Since the behemoth has become established, it’s like the Food Lion staff received an injection of motivation! The cashiers are even friendlier, the store has been upgraded, and the manager has an even stronger presence on the floor, engaging with customers, thanking them for their business, making us feel like they truly appreciate us shopping at their store. It only took one of these visits to secure my loyalty, but each repeat experience solidifies the benefits of local competition. The manager understands that if he and his staff don’t provide a good user experience, then there are other options within a mile of his store. But by simply being pleasant, and keeping a clean well organized store, there is no way I would shop at his near competitors, even knowing that I could likely get the same product for less across the street at Walmart

The Realities of Being the Only Show in Town

Don’t get me wrong, I respect the owners of any small business. You are contributing more to the local economy than I am. But if a new gym came to town, I would be highly inclined to join. The allure would not be fancy new state of the art equipment nor an abundance of classes, girls in yoga pants, or even a water fountain (though I am pleased to at least see a water cooler these days). I’d simply like to go to a gym with a friendly, welcoming environment. On several occasions I and others I know have encountered abject rudeness from a longtime employee at Village Health. When given a choice, why would I want to have to tolerate a rude employee? But given no choice… well, what choice do I have?

I’ve come to the conclusion that T&C was lulled into a false sense of loyalty. Their core patrons simply had no other choice. But once they did… they left, just like I would if a new gym came to town.

Staying Viable

I know that Food Lion took a hit when Super Walmart set up shop across the street. I know this because the manager told me while he was bagging my groceries. In the first quarter they were down about 30%, and in the second quarter 18%. I would be interested to see if that profit loss trend continued to shrink. I suspect Food Lion would gain back some of their customers, assuming the caliber of operations remained higher quality than Walmart or improved even more.

T&C’s trump card was nostalgia. I have seen it voiced all across Facebook over the last month. People love the idea of the local grocery store… and I am one of them. My favorite grocery store of all time was the Emigration Market in Salt Lake City, UT. Had T&C stepped up their game, I think the people of Oriental would have remained loyal. I would be surprised to see a Pizza Hut survive across the street from the Silos…

Is Walmart the bad guy?

Deep down I don’t think so. The support they received in Oriental suggests that many others felt similarly. In sum, I didn’t feel obligated to support T&C because they didn’t make me feel like a valued customer. I don’t expect an independent grocer to provide all the goods and services of a what I’d expect from a mega-chain with all the inherent leverage in procurement and economies of scale. I do not expect them to be able to beat the mega chain’s prices. I do however expect to be treated the same. Customer service cannot be purchased in bulk.